Micron plays hardball with Hynix banks

CIOL Bureau
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US chipmaker Micron Technology is now demanding that Hynix's Korean bankers,

who are owed some 7 billion by Hynix, put up yet another $1.15 billion in order

for Micron to take over the struggling Korean chipmaker.


It was reported earlier this week that Micron had increased its bid for Hynix

from $3.1 billion to $3.8 billion. But the company apparently also demanded that

the Korean banks make a new financial commitment to the struggling memory

operation in the form of a new $1.5 billion credit line.

Analysts speculate Micron's demand is merely designed to flush out the Korean

banks' demand for a higher purchase price. As the two demands are equally

unreasonable and unacceptable, both sides are more likely to agree on the

purchase price Micron is willing to pay for Hynix. The Micron demand is similar

to the company's demand in 1998 when it acquired the memory chip operations of

Texas Instruments for $800 million.

Micron received $750 million in financing from TI in exchange for it buying

TI's memory operations. Hynix CEO Park Chong-sup has once again traveled to the

United States to oversee the negotiations. Bt the Korean chipmaker also

continues to talk with Germany's Infineon Technologies about some form of